I am sure some may do it,but I would not try it.You will find that it is against the terms of your merchant agreement with your processor.
I am sure it would be hard to track but I would not want to have my merchant account canceled for it.
I will be interested to hear what others have to say.

it would probably violate your merchant agreement, but you could use another person as a conduit.

the problem with the theory is the transaction charges. You would end up losing 1.5%-2.5% of everything you charged through the merchant account. It might only be worthwhile with a double or triple mile promos...you need to work the numbers to see if it's worthwhile, otherwise you could end up spending $3000 for 2 FC tickets to Hawaii in transaction and finance charges.

<font face="Verdana, Arial, Helvetica, sans-serif" size="2">Originally posted by daniellam:
The charge would then be recorded as "Loan from Shareholder" on your business's books, and then be repaid to "you" with a cheque or by cash.</font>

And for some extra miles, you'd have the privilege of the business paying a transaction fee, and likely engaging an accountant to figure out the specifics of the "transaction" (remember a loan must have interest), not to mention the tricky issue of how to pay you interest if the business is actually losing money on the "loan." Good luck explaining this to your merchant processor (you could be blacklisted), other shareholders (why are you using this business as a personal miles conduit?), and to the IRS (what's the economic substance of the transaction?).

Why limit it just to businesses? Just about anybody can get an internet merchant account over at a place like 2checkout.com and the others, and just pay the transaction fees (and $49 one time setup). Set up a one item store and charge away. Of course it's a 5.5% fee to do that, with a 45 cent fee per transaction, but you get the miles.

<font face="Verdana, Arial, Helvetica, sans-serif" size="2">Originally posted by PETEFLYS:I am sure some may do it,but I would not try it.You will find that it is against the terms of your merchant agreement with your processor.
I am sure it would be hard to track but I would not want to have my merchant account canceled for it.
I will be interested to hear what others have to say.</font>

you are right...I once considered this move, called amex on it...but found out it is illegal per their contract....

bocasteve is also right, you dont want to fork out 3000 for 2 FC tix...you want to do it in a sweet deal....I found it only works well with 2x or 3x point promos....amex has always traditioanlly charged a higer discount rate to merchants....for us example, our client base uses very little amex 5% of our credit card sales are amex...very little...so our discount rate matches that amount of volume....now we do 80% with visa...so I have room to negotiate with them....with our rate so high with amex...I would buy my own miles in the discount rate process...

pgalore....for business travel costs that are directly reimbursible, I charge on my own cards, and ask my clients to send a check made out to myself, rather than the business.
That way, I don't have to do as much paperwork for my business. ....

would you please go in to a little more details about this...kinda interested...

<font face="Verdana, Arial, Helvetica, sans-serif" size="2">Originally posted by pgalore:...You shouldn't be getting 1099s for these reimbursements either, since they are pass-through.</font>

According to my sources, these reimbursements should be on a 1099-MISC if they go to a sole proprietor. The payor must report everything he/she/it paid you. Its being a pass-through on your return is out of their control, generally off their radar, and in any case in the future when the reimbursement is made and when the 1099-MISC is issued. You report the income, the offsetting deduction(s), and it's a wash.

If payment is to a corporation, there is no 1099 at all.

Reimbursed travel expenses are not reportable only for reimbursement of employees by their employer.

<font face="Verdana, Arial, Helvetica, sans-serif" size="2">Originally posted by MikeLaw: Not by companies that know what they are doing. Corporations are specifically exempted from 1099-MISC reporting with a few exceptions.</font>

But there is nothing stopping the payor from issuing a 1099-MISC to a corporation volutnarily. I know some companies have a policy of issuing 1099-MISC's to everyone they pay just so that they don't have to sort out which vendors are corporations and which aren't, and possibly be held responsible for a mistake.

The IRS will obviously know when it gets a 1099-MISC if it's for a corporation, based on the EIN. I don't know if it just ignores those that it gets for corporations, or if these are somehow compared to the corporate tax return like they are for individuals.